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Responding to climate change in the next 15 years is the world’s “mega development project”, given the need to invest trillions of dollars in infrastructure, creating jobs and economic stability, the United Nations’ top climate change official said on Tuesday.

“It makes fundamental economic sense” for countries to push forward on tackling climate change because of the benefits it will bring in terms of food, water and energy, as well as employment, Christiana Figueres told a carbon market conference in Barcelona.

This, together with the speed at which businesses are acting on climate change and efforts to put a price on carbon, mean “a decarbonised world is now irreversible, irrefutable,” the head of the UN climate change secretariat told the conference.

“We are going to do it, because frankly we don’t have any other option,” she said.

Decarbonisation refers to shifting from fossil fuels to renewable energy sources, and improving energy efficiency, in order to cut planet-warming emissions to a net zero.

Rachel Kyte, the World Bank’s special envoy for climate change, said to decarbonise economies, “we will need to begin with extraordinary ambition at the end of this year” in Paris where countries are due to agree a new global deal to tackle climate change.

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Every country will need to manage an orderly transition to low-carbon growth and resilient development.

Rachel Kyte, special envoy for climate change, World Bank

Experts say the national plans countries are now compiling for that deal are unlikely to add up to the reductions in greenhouse gas emissions needed to keep global warming to an internationally agreed limit of 2 degrees Celsius.

Market mechanisms needed

Market mechanisms, such as carbon taxes and emissions trading schemes, would be key in mobilising a global response on a big-enough scale, Kyte said.

“Every country will need to manage an orderly transition to low-carbon growth and resilient development,” she said, adding that carbon pricing would be one necessary element of that transition.

On Tuesday, the World Bank said in a report that emission trading schemes were worth an estimated $34 billion on April 1, up from $32 billion in 2014, while the value of carbon taxes around the world amounted to about $14 billion.

Countries introducing such initiatives include developing nations such as China, Mexico and South Africa.

Putting a price on carbon would be the foundation for unlocking investment in low-carbon economies “with hope for jobs and competitiveness - not a picture of sacrifice and of loss and giving things up”, Kyte said.

The Paris agreement should send an “unequivocal signal” that markets will play a key role in tackling climate change and underscore the need to “get prices right”, she said.

That would enable the current bottom-up patchwork of carbon pricing initiatives in some 40 nations and over 20 cities, states and regions to grow even faster, she added.

Carbon markets have struggled in recent years, with prices plummeting due to a lack of demand amid uncertainty over how the world planned to tackle climate change.

The UN’s Figueres said constructing a new international framework to curb global warming was going to be more complex than earlier thought.

“We are currently in an era of transition - a construction site if you will,” she said.

“By definition, transitions and construction sites are messy and that is a good thing, because everybody is trying to figure out how…they move forward.”